Traditionally, warehouse management systems (WMS) and transportation management systems (TMS) have for the most part worked independently within the same supply chain. The former is an execution platform that streamlines every part of warehouse management while the latter is a logistics platform that helps businesses optimize the movement of goods, both incoming and outgoing. 

Although these systems have worked well in their own right to provide supply chain managers with essential information to run their operations, the emergence of digital and cloud tools has paved the way for enhancing their value substantially through integration. Linking a WMS and TMS creates a streamlined solution that shows labor, inventory, delivery trucks, partners and more in a single location, allowing all parties to work from the same data and assumptions. The benefits of this relationship are numerous, including the ability to adapt and react more easily to supply chain disruption. But before we get too far, let’s take a closer look at the nature of a WMS and a TMS.

Warehouse Management Systems

Widely used in the manufacturing, third-party logistics and retail industries, a WMS tracks inventory from the moment it arrives at the warehouse to the moment it leaves as part of a customer’s order. Simply put, a WMS helps optimize all warehouse processes including picking, packing, shipping and organizing inventory replenishment while providing businesses with real time visibility into inventory and operations. Additionally, a WMS helps businesses enhance their labor and space utilization and equipment investments by coordinating and optimizing resource usage and material flows. 

A well-designed and implemented WMS will help streamline and automate inventory fulfillment processes while controlling costs. An example is a WMS Netlogistik implemented across four warehouse locations for a global leader in temperature-controlled logistics. Upon implementation, the WMS has helped this customer realize a number of important benefits, including increased operational efficiency, cost control and an improved customer experience.

Transportation Management Systems

A transportation management system, when used with GPS technology or a mobile device, is a valuable tool that helps businesses plan, execute and optimize the physical movement of goods, both inbound and outbound. An effective TMS will help streamline the shipping process and make it easier for businesses to improve their transportation operations by considering the entire scope of the supply chain and its impact on transportation management needs. 

With features that include order management, load planning, route scheduling, freight tracking, document/compliance management and more, a TMS helps ensure that goods arrive at their destinations on time and on budget with zero issues. This can reduce costs throughout the supply chain.

The Value of WMS and TMS Integration

Bringing these two platforms together generates a number of important benefits. At the top of the list is the creation of a single point of vision for entire operations, also known as a “single version of the truth.” Like a control tower, this puts essential data in one convenient place, with information flowing seamlessly between the two systems—creating the ability to move different orders or products through a warehouse at varying rates with fluctuating levels of urgency. 

Ideally, the centralized viewpoint that results from WMS/TMS integration should be shareable, enabling people both internally and externally to work with the same data and insights, creating the ability to more easily adapt and react to virtually any disruption throughout the supply chain. This provides exceptional value to businesses that experience substantial swings in demand, helping them optimize their existing warehouse space and staff while maximizing shipping efficiency and enhancing overall operational performance.

General Considerations for Bringing the Two Systems Together

Integrating a WMS and a TMS can be a challenging prospect. That is why it’s important to create a plan that’s clear and concise. A good first step is to review existing tools and determine what works together. Then, look into which TMS tools vendors are using. Are the systems in play compatible with each other? Can the systems communicate using the same data formats, standards and protocols? If the WMS uses XML and the TMS uses EDI, for example, a middleware or a converter will be needed to translate the data. 

What type of hardware does your operation use? This can include devices from scanners and sensors to forklifts and any specialty tools that are required. The answer is important when it comes to selecting the right software and integration options.  

When bridging your WMS and TMS software, be sure to check if application programming interfaces (API) are available. An API is an essential link that allows two pieces of software to communicate. More specifically, they automate communication and data sharing to make it easier to manage WMS and TMS platforms, implement changes and utilize relevant information. An API is especially helpful for very large supply chains that employ dozens of systems to track transportation activities, which can include hundreds of change and exchange points. By automating the data moving between companies and systems at these points, APIs can eliminate the potential for human error.

Make it About the Customer

The goal of bringing a WMS and a TMS together is to create efficiencies that impact the entire supply chain. Getting there, however, can be complex and involve many moving parts—sometimes too many moving parts when the process evolves due to a change in requirements or functionality. This can lead to the addition of more work and cost than originally planned, often without assurance that it will provide additional benefit. 

An effective way to prevent this scenario, or at least minimize it, is to consider how a given process change and/or cost addition will improve the customer experience. Will it help lower the cost of delivery? Will it facilitate faster delivery times? Will it make it easier to track a shipment? Let the answers to these questions guide your decision making as it applies to WMS/TMS integration. You’ll gain greater control over the size and scope of an expanding integration process, while working to increase customer satisfaction and build long-term loyalty.